Opposition Brief — Sea Hawks Seafoods, Inc. v. Exxon Mobile Corp (No. 08-1562)

IN THE

Supreme Court of the Anited States

SEA HAWK SEAFOODS, INC.,

Petitioner,

Vv

EXXON MOBIL CORPORATION AND

EXXON SHIPPING COMPANY,

Respondents.

On Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Ninth Circuit

BRIEF IN OPPOSITION

JOHN F. DAUM DOUGLAS J. SERDAHELY

(Counsel of Record) PATTON BoGcs LLP

JORDAN RAPHAEL 601 West Fifth Avenue

O’MELVENY & MYERS LLP Suite 700

400 South Hope Street Anchorage, AK 99501

Los Angeles, CA 90071 (907) 263-6300

(213) 430-6000

Attorneys for Respondent Attorneys for Respon-

Exxon Mobil Corporation dent Exxon Shipping

Company

Counsel for Respondents

QUESTION PRESENTED

The sole quéstion properly presented is:

Where both the district court and the Ninth Cir-

cuit correctly stated this Court’s “flexible” standard

for judicial estoppel, New Hampshire v. Maine, 532

U.S. 742, 750-51 (2001), whether the lower courts

abused their discretion in applying that standard to

the facts of this case?

ll

RULE 29.6 STATEMENT

Respondent Exxon Mobil Corporation is a pub-

licly held corporation, and no person or entity owns,

directly or indirectly, 10% or more of its stock. Re-

spondent Exxon Shipping Company is wholly owned,

directly or indirectly, by Exxon Mobil Corporation.

lil

TABLE OF CONTENTS

Page

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IE Sak sede duicddnantaniinininsseibenseeankinmibunpeantan 1

SEAT see © CIE EBA CRISES vice sccccsnesscrsnnssnssessuvecas 1

Bi. PGCCURE TCT OUING ooo cc ceesessesesessecesseses 2

B. The Rulings On Judicial Estoppel

FE vkiisiniconcichnrscecamebionesirens 7

REASONS FOR DENYING THE PETITION ........ 11

A. The Decisions Below Did No More

Than Apply The Principles of New

FEGIADOREPS U. BEGEIAG occ cccsccoscscseccussncesssses 11

B. Petitioner Has Not Demonstrated

Any Conflict In The Circuits ................. 14

ARTA EIR IIOE sitasnsiskinssseriniseancneesnameniion 19

lV

TABLE OF AUTHORITIES

Page(s)

CASES

1000 Friends of Md. v. Browner,

265 F.3d 216 (4th Cir. 2001) ...........-..ccccccecsesseens 15

Ameritox, Ltd. v. Aegis Corp.,

No. 07-80498, 2008 WL 4540063

(S.D. Fla. Oct act cceddasidnrescivesnvesssteneanns 17

Bradford v. Wiggins,

516 F.3d 1189 (10th Cir. 2008) ............ccceeeeesenees 15

Duthie v. Matria Healthcare, Inc.,

540 F.3d 533 (7th Cir. 2008) ..............cccccccrrressees 15

In re Oneida Ltd.,

383 B.R. 29 (Bankr. S.D.N.Y. 2008),

reu'd and remanded on other

grounds, 562 F.3d 154 (2d Cir. 2009)................ 17

In re the Exxon Valdez,

270 F.3d 1215 (9th Cir. Ree aeeerte tease: 2

New Hampshire v. Maine,

Ee PIE beisniscescacseevexseacssooessensess passim

NLRB v. Hendricks County Rural Elec.

Membership Corp.,

ries Me UD tie sinccctensersnncssesesscssseonsssvesseens 13

Pennycuff v. Fentress County Bd. of

Educ.,

404 F.3d 447 (6th Cir. 2005)............ cee eeeeeeeeees 15

Peoples State Bank v. GE Capital Corp.

(In re Ark-La-Tex Timber Co.),

GOB Fe BAe OE AE, BIG E) occccnccscccccesscccssresosees 15

SBT Holdings, LLC v. Town of

Westminster,

BGT F.2e Se (ERE Cir. DOOB).........ccccecccosscsesscacsness 15

Vv

TABLE OF AUTHORITIES

(continued)

Sea Hawk Seafoods, Inc. v. Exxon

Corp.,

484 F.3d 1098 (9th Cir. 2007).................

Stallings v. Hussmann Corp.,

447 F.3d 1041 (8th Cir. 2006).................

Stephens v. Tolbert,

471 F.3d 1173 (11th Cir. 2006)...............

Stichting Ter Behartging Van de

Belangen Van Oudaandeelhouders

in Het Kapitaal Van Saybolt Int'l

B.V. v. Schreiber,

407 F.3d 34 (2d Cir. 2005)...................222.

Thore v. Howe,

466 F.3d 173 (1st Cir. 2006)....................

Transamerica Leasing, Inc. v. Institute

of London Underwriters,

430 F.3d 1326 (11th Cir. 2005)...............

United Nat'l Ins. Co. v. Spectrum

Worldwide, Inc.,

555 F.3d 772 (9th Cir. 2009)...............00

United States v. Johnston,

Be Ae IE CRUD siineressssnecesscosreaceesovcess

United States v. Pelullo,

399 F.3d 197 (3d Cir. 2005).....................

Uzdavines v. Weeks Marine, Inc.,

418 F.3d 138 (2d Cir. 2005).....................

W. Pac. Fisheries, Inc. v. S.S. President

Grant,

730 F.2d 1280 (9th Cir. 1984).................

vi

TABLE OF AUTHORITIES

(continued)

Page(s)

STATUTES

28 U.S.C. § 1961(a) ...........0.000 SNA SET ee Ye. 3

ED nis sh nes chindenoboonmessibeaneveessbass 1,3

I «0 ds cincdendanonneamncopoaneoeenatbarts 1,6

OTHER AUTHORITIES

Eugene Gressman et al., Supreme Court

Practice (9th ed. 2007)...........ccccccsescccecess 13, 16, 18

Stephen G. Breyer, Reflections on the

Role of Appellate Courts: A View

from the Supreme Court,

8 J. App. Prac. & Process 91 (2006)................... 16

os ss gnaamannieneansenaye 13, 14

INTRODUCTION

In New Hampshire v. Maine, 532 U.S. 742 (2001),

this Court held that three “flexible” and non-

exhaustive factors should inform the decision of

whether to apply judicial estoppel in a given case.

Id. at 750-51. The district court’s judgment is a

straightforward, factbound application of the princi-

ples enunciated in New Hampshire. Neither that

judgment, nor the Ninth Circuit’s affirmance of it,

conflicts with any decision of this Court or implicates

any circuit conflict. This case is, in short, a most

unworthy candidate for certiorari. The Petition

should be denied.

STATEMENT OF THE CASE

The underlying issue here is whether Respon-

dents Exxon Mobil Corporation and Exxon Shipping

Company (collectively, “Exxon”) made an agreement

to pay Petitioner compound prejudgment interest re-

gardless of whether state law or federal law gov-

erned the rate of interest. Alaska law provides, as

applicable here, that prejudgment interest is simple

(at the rate of 10.5%) unless the parties have agreed

otherwise. AS 09.30.070(a); Pet. App. 7-8. Peti-

tioner claims that such an agreement was made.

fxxon agrees that in prior judicial proceedings it ac-

knowledged that interest could be compounded if

federal law governed the rate of interest, see 28

U.S.C. § 1961(b), but denies that any agreement was

made to pay compound interest if state law governed.

The district court examined the record of the parties’

negotiations, and, in a careful opinion, found as a

fact that no agreement was made to pay compound

interest in all circumstances. Pet. App. 8-14, 17-20.

2

The Ninth Circuit affirmed, on the ground that the

district court’s decision was “not clearly erroneous.”

Judge Graber dissented. Pet. App. 2, 3. Petitioner

does not seek review of that purely state-law deter-

mination.

Instead, Petitioner argues that three “equivocal”

statements, Pet. App. 17, give rise to a judicial es-

toppel, as a result of which Exxon should be held

bound by an “agreement” that the district court has

found Exxon never made. Pet. 6-7. The district

court rejected Petitioner’s judicial estoppel theory on

the ground that: (1) Exxon had not taken inconsis-

tent positions; (2) the court had never been misled

about Exxon’s position; and (3) there was no unfair-

ness to Petitioner — the three factors that go to

whether a judicial estoppel should be found under

New Hampshire v. Maine. Pet. App. 14-16. The

Ninth Circuit affirmed in a decision that was

unanimous on the judicial estoppel point. Pet. App.

2-3. This Petition followed.

A. Factual Background

On March 24, 1989, the tanker EXXON VALDEZ

ran aground in Prince William Sound, Alaska. Pet.

App. 23. Exxon and Petitioner, a seafood processor,

promptly resolved Petitioner’s claims for loss of in-

come in 1989, but could not agree as to whether Peti-

tioner was entitled to damages in subsequent years.

After years of litigation, see In re the Exxon Valdez,

270 F.3d 1215, 1250-53 (9th Cir. 2001), the parties

were able to agree on the amount of damages Peti-

tioner had suffered, but still could not agree on how

prejudgment interest on those damages should be

calculated.

3

The parties’ negotiations occurred against the

background of a prior ruling by the district court

(Order No. 299) to the effect that prejudgment inter-

est would be governed by federal law, specifically 28

U.S.C. § 1961. See Pet. App. 30-31. Under that

statute, the rate of interest is the “weekly average 1-

year constant maturity Treasury yield,” 28 U.S.C. §

1961(a), unless the district court determines other-

wise based on the circumstances of the case. See W.

Pac. Fisheries, Inc. v. S.S. President Grant, 730 F.2d

1280, 1289 (9th Cir. 1984). The statute expressly

provides that interest “shall be compounded annu-

ally.” 28 U.S.C. § 1961(b).

On September 27, 2004, the parties filed a stipu-

lation with the district court advising that they had

reached a negotiated settlement resolving all of Peti-

tioner’s outstanding claims for compensatory dam-

ages. Pet. App. 73-74. The stipulation also outlined

the parties’ disagreement over prejudgment interest:

Exxon maintained that Order No. 299 mandated the

use of the federal rate under 28 U.S.C. § 1961, while

Petitioner insisted that it was entitled to a higher

interest rate. Id. The parties stipulated that Peti-

tioner “may move for determination of the appropri-

ate rate of prejudgment interest on this settlement.”

Id. The stipulation did not address whether interest

would be simple or compound. /d.

The parties memorialized their settlement

agreement in a December 1, 2004 letter. Pet. App. 8.

The letter recited that although the parties had

agreed interest would be paid on the compensatory

damages amount, “they have not agreed as to the

appropriate interest rate or amount.” Jd. The set-

tlement agreement, like the parties’ stipulation and

4

the correspondence leading up to their settlement,

was silent as to whether prejudgment interest would

be simple or compound. Pet. App. 9.

Pursuant to the parties’ agreement, Petitioner

filed papers on the prejudgment interest issue, con-

tending that a rate ranging from 29.32% to 9.20%,

compounded annually, should apply to the settle-

ment. Pet. App. 11, 27. Petitioner justified its re-

quest for compound interest not on the basis of any

supposed agreement between the parties, but on the

theory that 28 U.S.C. § 1961 gave the district court

discretion to order compound interest, regardless of

whether it determined that federal law or state law

governed. Pet. App. 11.

In its responding papers, Exxon argued that Or-

der No. 299 dictated the proper rate of prejudgment

interest. Pet. App. 31. Exxon also agreed that it

was within the court’s discretion to decide whether

interest should be compounded under 28 U.S.C. §

1961, and pointed out that in calculating the

$742,799 in interest already paid to Petitioner (pur-

suant to Order No. 299), “Exxon voluntarily agreed

to compound interest and factored that in to the

computation of what it agreed to tender to Sea

Hawk.” Pet. App. 71n.16. Exxon wrote:

Consistent with Order 299 and the uni-

form settlement practice in this case, the

Court should fix the rate at 2.47%, the rate in

effect when Exxon and Sea Hawk made their

deal, but certainly no more than the federal

funds rate in effect at the time of its loss,

4.11% for 1992 and 5.34% for 1993, with in-

5

terest compounded annually which Exxon

voluntarily has done.

Pet. App. 70-71 (emphasis added).!

On April 12, 2005, the district court ruled that 28

U.S.C. § 1961 governed prejudgment interest, con-

cluding that federal law controlled the interest issue

“despite the fact that Sea Hawk’s claims are based

on state law.” Pet. App. 44. Noting that “Exxon

states that it has voluntarily agreed to compound the

interest annually,” Pet. App. 30, the district court

also held that “(t]he parties have agreed that pre-

judgment interest will be compounded annually; so,

the motion is granted as to that issue,” Pet. App. 46.

In a subsequent order, the district court explained

that, at the time of its April 12, 2005 ruling,

the court did not believe that Exxon and Sea

Hawk had an agreement as to compound in-

terest if state law applied. Rather, it believed

that Exxon had agreed to pay compound inter-

est on the amount of prejudgment interest

that it had already tendered to Sea Hawk, in-

terest which had been calculated under federal

law, which provides for compound interest.

The court’s reference to an “agreement” be-

tween the parties as to compound interest was

a result of there being no disagreement about

compounding when the federal rate is em-

ployed, not the result of there being an agree-

‘ The Petition repeatedly cites this and similar language as

if it represented an agreement by Exxon to pay compound in-

terest, as distinct from a factual description of how Exxon had

calculated interest already paid. As the district court pointed

out, the two are quite different. Pet. App. 11-12.

6

ment that prejudgment interest would be com-

pounded even if state law applied. The court

did not believe that {}] Sea Hawk and Exxon

had reached an overarching agreement as to

compound interest.

Pet. App. 14 (emphasis in original).?

On appeal, Petitioner argued that the district

court erred by using federal law instead of Alaska

state law to set the rate of prejudgment interest. See

Pet. App. 54. In response, Exxon pointed out that

Petitioner was asking the court of appeals to apply

Alaska law inconsistently because it was both seek-

ing compound interest and asking the court to apply

AS 09.30.070(a), which provides for simple interest

only. See id. To amplify this point, Exxon wrote

that Petitioner “never asked the district court to ap-

ply the ‘whole’ of state law: it asked it to incorporate

an Alaska statute providing for simple interest only

into a settlement where interest is to be com-

pounded.” Pet. App. 54 n.9.

At oral argument, Exxon’s counsel reiterated the

point about the inconsistency between Petitioner's

seeking compound interest and the terms of the

2 The Petition several times quotes a single sentence from a

letter between counsel dated April 20, 2005, Pet. App. 50-51,

which was intended to implement the order of April 12, 2005.

Pet. 3, 7, 17. Of course this letter cam have no application

whatever to the question of judicial estoppel, since it involves

no statement made to a court, and was dated after the district

court’s ruling of April 12, 2005. In any event, as the district

court pointed out, the sentence on which Sea Hawk relies is

ripped out of its original context; in its proper context it does

not have the meaning that Sea Hawk tries to give it. Pet. App.

i9.

7

Alaska statute. He noted that “the application of the

Alaska statute to this case, by its own terms, is not

possible, because the stipulation provides for interest

to be compounded, the Alaska statute provides for

simple interest.” Pet. App. 58. If there was any

ambiguity in this statement, the ambiguity was

promptly cleared up in response to a question from

Judge Graber, as the district court noted, with an

unequivocal statement of Exxon’s position that it

never agreed to compound interest in all circum-

stances. Pet. App. 16-17, 58-59.

The Ninth Circuit reversed the district court’s

ruling that federal law applied, holding that state

law should control the interest payable on a judg-

ment based on state law. Sea Hawk Seafoods, Inc. v.

Exxon Corp., 484 F.3d 1098, 1102-03 (9th Cir. 2007).

The court of appeals did not decide whether interest

should be simple or compound, and remanded for the

district court to resolve that question. Id.

B. The Rulings On Judicial Estoppel Below

On remand, the district court vacated its prior

order “as regards the rate of interest and calculation

of interest,” and ordered counsel to confer on an

amended final judgment that calculated prejudg-

ment interest pursuant to the Ninth Circuit’s ruling.

Pet. App. 6. Petitioner responded by filing a motion

seeking an order that Exxon should pay compound

prejudgment interest. Jd. Petitioner argued that:

(1) Exxon had agreed to pay compound interest no

matter which law, federal or state, the district court

found to apply; and (2) Exxon was judicially estopped

by its previous statements to the district court and

8

the Ninth Circuit from denying that it had agreed to

pay compound interest. Pet. App. 14-16, 18.

In a careful opinion, the district court examined

the settlement agreement, the relevant correspon-

dence leading up to and following the settlement,

and the parties’ prior statements made during the

litigation. Pet. App. 8-20. Based on its review of

this evidence, the district court concluded that “the

parties never agreed that Exxon would pay com-

pound interest regardless of whether state or federal

law governed.” Pet. App. 20.

Next, applying the factors set forth in New

Hampshire, 532 U.S. at 750-51, the district court de-

clined to find a judicial estoppel. Pet. App. 14-17.

The district court held that Exxon’s current position

was not “clearly inconsistent” with its earlier posi-

tion. Pet. App. 15. The reason, wrote the court, was

that during the initial prejudgment interest phase of

the litigation,

[it] did not believe that Exxon had taken the

position that it had an agreement with Sea

Hawk that it would pay compound interest re-

gardless of whether state or federal law ap-

plied. Rather, it was the court’s perception

that Exxon’s position was that prejudgment

interest would be compound if federal law ap-

plied. The position that Exxon now takes, that

it never agreed to pay compound interest if

state law applied, is not inconsistent with its

earlier position.

Id.

The district court continued that even if Exxon

had taken inconsistent positions, its acceptance of

9

Exxon’s current position “would not create a percep-

tion that this court was previously misled.” Id. In

its reference to Exxon’s “agreement” in its initial rul-

ing on the prejudgment interest issue, the court

wrote, “it did not believe that Exxon had agreed to

pay compound interest even if state law applied.” Id.

Finally, the district court held that Exxon had

not gained an unfair advantage because both parties

“have been given the opportunity to brief and argue

the question of whether the parties had an agree-

ment as to compound interest.” Pet. App. 15-16.

Addressing Exxon’s argument to the Ninth Cir-

cuit that Petitioner was asking for the incorporation

of “an Alaska statute providing for simple interest

only into a settlement where interest is to be com-

pounded,” the district court refused to find this to be

an admission by Exxon that it had agreed to pay

compound interest. Rather, the district court con-

cluded that this statement was made in the context

of Exxon’s legal argument that compound interest

and AS 09.30.070 are inconsistent. Pet. App. 16.

Further, this legal argument was “entirely consis-

tent with Exxon’s argument that compound interest

is not allowed under Alaska state law.” Id.

Similarly, the district court ruled that the

“equivocal” statements by Exxon’s counsel at oral

argument before the Ninth Circuit “provide no sup-

port for Sea Hawk’s contention that Exxon repre-

sented to the court of appeals that it had agreed to

pay compound interest if state law applied.” Pet.

App. 16-17.

The Ninth Circuit affirmed. The court of appeals

first held that the district court’s conclusion that the

10

parties did not agree to compounding, reached

“[alfter taking evidence and hearing arguments,”

was not clearly erroneous. Pet. App. 2. The court of

appeals noted:

Although a letter from Exxon to Sea Hawk

stated in part that the parties “agreed that

prejudgment interest will be compounded an-

nually,” that statement appeared in the con-

text of a ruling by the district court that the

federal interest rate applied. The remainder

of the letter suggests that the parties made

their entire agreement in the light of that rul-

ing and, therefore, in the expectation that fed-

eral law governed.

Id.

The court of appeals also ruled that the district

court did not abuse its discretion in declining to ap-

ply judicial estoppel against Exxon. Id. The court

of appeals noted: “Although the [district] court rec-

ognized that Exxon had previously taken the posi-

tion that it had voluntarily agreed to compound in-

terest, the court understood the agreement to be lim-

ited to federal law. That is, the court was not mis-

led.” Pet. App. 2-3. In dissent, Judge Graber wrote

that the district court “clearly erred in finding that

the agreement to pay compound interest depended

on application of the federal rate of interest.” She

did rot, however, dissent from affirmance of the dis-

trict court’s refusal to invoke judicial estoppel. Pet.

App. 3.

Petitioner’s petition for panel rehearing was de-

nied. Pet. App. 47.

11

REASONS FOR DENYING THE PETITION

The Petition purports to seek review so that this

Court may address whether the application of judi-

cial estoppel requires showings that: (1) “a litigant’s

previous inconsistent position was adopted or ac-

cepted by the court in which it was advanced,” and

(2) “a court was misled by the litigant’s prior posi-

tion.” Pet. i. These Questions Presented reveal a

basic misunderstanding of the decisions below. Nei-

ther the district court nor the Ninth Circuit passed

on either of those questions. Instead, they both

stated correctly the flexible principles of judicial es-

toppel enunciated by this Court in New Hampshire

v. Maine, and then applied those principles to find

that judicial estoppel should not be applied here.

Those factbound rulings raise no issue that warrants

review; and they implicate no conflicts in the cir-

cuits.

A. The Decisions Below Did No More Than

Apply The Principles of New Hampshire

v. Maine

In New Hampshire, this Court, observing that the

circumstances for applying judicial estoppel “are

probably not reducible to any general formulation of

principle,” 532 U.S. at 750 (internal citations omit-

ted), nevertheless identified three factors that “typi-

cally inform” whether to invoke judicial estoppel:

First, a party's later position must be “clearly

inconsistent” with its earlier position. Second,

courts regularly inquire whether the party has

succeeded in persuading a court to accept that

party's earlier position, so that judicial accep-

tance of an inconsistent position in a later pro-

12

ceeding would create “the perception that ei-

ther the first or the second court was misled.”

Absent success in a prior proceeding, a party's

later inconsistent position introduces no “risk

of inconsistent court determinations,” and

thus poses little threat to judicial integrity. A

third consideration is whether the party seek-

ing to assert an inconsistent position would

derive an unfair advantage or impose an un-

fair detriment on the opposing party if not es-

topped.

Id. at 750-51 (internal citations omitted).

The district court’s opinion in this case faithfully

adhered to these principles, first setting forth the

New Hampshire factors and then applying them to

the facts of this case based on a detailed review of

the evidence. See Pet. App. 14-16. Exercising its

considerable discretion, the district court declined to

find judicial estoppel, because: (1) Exxon’s position

that it did not agree to pay compound prejudgment

interest if state law applied was not inconsistent

with its prior position that interest would be com-

pounced if federal law was deemed to apply; (2)

th +re could be no perception the court had been mis-

led since the court had never adopted the view that

Exxon “had agreed to pay compound interest even if

state law applied”; and (3) there was no unfair ac-

vantage because the parties received the opportunity

to brief and argue the issue of whether there was an

agreement to compound interest. Pet. App. 15-16.

The Ninth Circuit affirmed, holding that the district

court’s refusal to invoke judicial estoppel was not an

abuse of discretion. Pet. App. 2-3.

13

Petitioner does not suggest, much less demon-

strate, that either the district court or the Ninth Cir-

cuit misstated the law that applies to judicial estop-

pel. Indeed, Petitioner’s statement of the law of ju-

dicial estoppel, Pet. 9-10, is virtually identical to the

district court’s statement of that same law, Pet. App.

14-15. Petitioner’s quarrel with the courts below is

plainly not a disagreement over the lower courts’

statement of the law; it is rather with their applica-

tion of that correctly-stated law to the particular

facts of this case. Thus, Petitioner restates its fac-

tual arguments why judicial estoppel should be ap-

plied, Pet. 17-18, and contends that the Ninth Cir-

cuit’s decision was “not a proper application of this

Court’s holding in New Hampshire,” Pet. 18. Even

assuming arguendo that those arguments had merit

(which they do not), neither of them presents a suit-

able ground for granting review. It is well estab-

lished that this Court “do[es] not grant a certiorari to

review evidence and discuss specific facts.” United

States v. Johnston, 268 U.S. 220, 227 (1925); NLRB

v. Hendricks County Rural Elec. Membership Corp..,

454 U.S. 170, 176 n.8 (1981) (improvident grant of

cross-petition that presented primarily “a question of

fact, which does not merit Court review”). Similarly,

the assertion that a lower court misapplied a prop-

erly stated rule of law rarely provides a basis for

granting certiorari, and should not do so here. See

Sup. Ct. R. 10; Eugene Gressman et al., Supreme

Court Practice 276 (9th ed. 2007) (this Court does

not “review and correct every misstep made by the

lower courts in the application of accepted princi-

pies”).

14

In short, nothing in the factbound rulings by the

district court and the Ninth Circuit “so far departed

from the accepted and usual course of judicial pro-

ceedings” so as to justify this Court’s review. Sup.

Ct. R. 10. To the contrary, as explained above, both

decisions were perfectly consistent with the princi-

ples for applying judicial estoppel laid down in New

Hampshire.

B. Petitioner Has Not Demonstrated Any

Conflict In The Circuits

Petitioner also contends that the Court should

review the Ninth Circuit’s judgment because there

are inter-circuit conflicts concerning whether judicial

estoppel can be applied when the court did not “ac-

cept” a party’s prior position, or in the absence of a

finding that the court was misled. Pet. 10-16. Peti-

tioner presents these points as if they were two in-

dependent subjects, but it is hard to see logically

how this can be so. If the court to which a party’s

first position was presented did not accept it, there

cannot be a “perception” that the court was misled.

“Absent success in a prior proceeding, a party’s later

inconsistent position introduces no risk of inconsis-

tent court determinations.” New Hampshire, 532

U.S. at 750-51. Conversely, it is hard to see how a

court that was not “misled” would accept a party’s

prior position that is inconsistent with the true facts.

What is in fact under discussion in the circuit

court cases cited by Petitioner is the extent to which

the second prong of New Hampshire’s “flexible” and

“non-exhaustive” test for judicial estoppel is a man-

datory prerequisite for a iinding of judicial estoppel.

All circuit courts uniformly follow New Hampshire's

15

holding that courts deciding whether to apply judi-

cial estoppel should consider whether a court ac-

cepted the party’s prior position and was misled.

Some courts emphasize this factor more than others,

and may even decline to find a judicial estoppel ab-

sent a tribunal’s adoption of a party’s prior position.

Other courts weigh “judicial acceptance” along with

the two other New Hampshire factors in considering

whether to invoke judicial estoppel.4 Both ap-

proaches, however, are consistent with the flexible

application of judicial estoppel principles endorsed

by this Court. See New Hampshire, 532 U.S. at 751

(“In enumerating these factors, we do not establish

inflexible prerequisites or an exhaustive formula for

determining the applicability of judicial estoppel.”).

At most, the differences among the lower courts in

applying the second prong of New Hampshire are at-

tributable only to “different verbal formulations of

the same underlying legal rule,” which, as Justice

Breyer has explained, are not “actual divides among

3 See SBT Holdings, LLC v. Town of Westminster, 547 F.3d

28, 37 (1st Cir. 2008); Stichting Ter Behartging Van de Belan-

gen Van Oudaandeelhouders in Het Kapitaal Van Saybolt Int'l

B.V. v. Schreiber, 407 F.3d 34, 45 (2d Cir. 2005); United States

v. Pelullo, 399 F.3d 197, 223 (3d Cir. 2005); 1000 Friends of Md.

v. Browner, 265 F.3d 216, 226-27 (4th Cir. 2001); Peoples State

Bank v. GE Capital Corp. (In re Ark-La-Tex Timber Co.), 482

F.3d 319, 333 (5th Cir. 2007); Pennycuff v. Fentress County Bd.

of Educ., 404 F.3d 447, 453 (6th Cir. 2005); Duthie v. Matria

Healthcare, Inc., 540 F.3d 533, 542 (7th Cir. 2008).

* See Stallings v. Hussmann Corp., 447 F.3d 1041, 1049

(8th Cir. 2006); United Nat'l Ins. Co. v. Spectrum Worldwide,

Inc., 555 F.3d 772, 780-81 (9th Cir. 2009); Bradford v. Wiggins,

516 F.3d 1189, 1195 (10th Cir. 2008); Stephens v. Tolbert, 471

F.3d 1173, 1177-78 (11th Cir. 2006).

16

the lower courts” but merely “minor linguistic dis-

crepancies” that “are not outcome determinative.”

Stephen G. Breyer, Reflections on the Role of Appel-

late Courts: A View from the Supreme Court, 8 J.

App. Prac. & Process 91, 96 (2006).

Contrary to Petitioner’s assertions, Pet. 10-13,

the circuit courts have not reached conflicting results

based on their different formulations of the weight to

be given New Hampshire’s second prong.® Petitioner

cites only to dicta. But dicta do not create a circuit

conflict in the absence of conflicting results. See

Gressman et al., supra, at 241 (To justify certiorari,

“there must be a real or ‘intolerable’ conflict on the

same matter of law or fact, not merely an inconsis-

tency in dicta or in the general principles utilized.”).

5 Nor has this purported conflict been “widely recognized.”

Id. at 13. The “conflict” discussed in Transamerica Leasing,

Inc. v. Institute of London Underwriters, 430 F.3d 1326 (11th

Cir. 2005), concerned the narrow question of “whether judicial

estoppel should apply when the prior position resulted in a set-

tlement, and not in the court actually adopting a position.” Jd.

at 1336 n.8. Notably, three of the five cases cited in Trans-

america on this point precede the New Hampshire decision, and

therefore could not have staked out conflicting positions on this

Court’s instructions regarding “judicial acceptance.” See id. In

addition, the authorities presenting the narrow conflict over

whether settlements qualify for judicial estoppel] are inapplica-

ble to the facts of this case. Here, the parties did not settle the

issue of prejudgment interest; they submitted it to the district

court for resolution, See Pet. App. 73-74. Similarly, the First

Circuit, in Thore v. Howe, 466 F.3d 173 (1st Cir. 2006), did not

identify “a split on this issue between the First and Third Cir-

cuits.” Pet. 13. It merely noted that while the First Circuit had

recognized certain criteria for the application of judicial estop-

pel, the Third Circuit had articulated certain others, none of

which were conflicting. See Thore, 466 F.3d at 182 n.2.

17

None of the cases Petitioner cites finds a judicial es-

toppel when the prior inconsistent statement was

not accepted by the prior court, or where the prior

court was not misled; similarly, none of Petitioner’s

cases refuses to find a judicial estoppel when the

first and third prongs of New Hampshire are met but

not the second.§ The results of the decided cases are

thus not in conflict, even if some language in some

cases might suggest a conflict may arise in some fu-

ture case.

Whatever the divergence in dicta in the circuit

courts, moreover, none of the issues under discussion

is presented by the facts of this case. Whether judi-

cial acceptance of the party’s prior position or the

perception that a court was misled should be an ab-

solute prerequisite for judicial estoppel or whether it

should be merely one factor among others to be

taken into account, the answer would make no dif-

ference here. Petitioner does not even suggest that

it would. Rather, in this case, the district court

looked at all the New Hampshire factors, and con-

cluded that none of them was present here. It does

6 Petitioner’s treatment of the cases is sloppy. Thus, Peti-

tioner says that some courts have allowed litigants to assert

inconsistent positions, “so long as no one is misled.” Pet. 16 &

n.7. But three of the four decisions Petitioner relies on each

expressly found that the parties had not asserted inconsistent

positions. Uzdavines v. Weeks Marine, Inc., 418 F.3d 138, 148

(2d Cir. 2005); Ameritox, Lid. v. Aegis Corp., No. 07-80498,

2008 WL 4540063, at *3 (S.D. Fla. Oct 10, 2008); Jn re Oneida

Ltd., 383 B.R. 29, 45-46 (Bankr. S.D.N.Y. 2008), rev'd and re-

manded on other grounds, 562 F.3d 154 (2d Cir. 2009). (The

fourth decision in fact found a judicial estoppel, and thus did

not allow the plaintiff to assert inconsistent positions. See

Thore, 466 F.3d at 181-85, 187.)

18

not matter to that determination in any way

whether the second prong is an absolute prerequisite

to a judicial estoppel or just one factor among many.

Whatever the legal significance of the second prong

in some other case, the district court found that that

prong was not met here. Therefore the district

court’s decision would not be changed in any way by

this Court’s resolution of the issues Petitioner asks

the Court to review.7? There is accordingly no reason

to grant certiorari. See Gressman et al., supra, at

504 (case “presents a poor vehicle for resolving a con-

flict” where case “would be decided in favor of the re-

spondent no matter how the conflict were resolved”).

Similarly, no circuit conflict is implicated by the

Ninth Circuit’s observation that “the [district] court

was not misled.” Pet. 18. That was not a ruling that

judicial estoppel could never apply unless a court

was misled, as Petitioner wrongly suggests. Id. The

court of appeals neither reached nor decided that

question. Its language reflected at most a holding

that a district court that (1) did not understand a

litigant’s statements to be inconsistent with one an-

other; and (2) was not misled could, without abuse of

discretion, refuse to find a judicial estoppel.

In New Hampshire, this Court ruled that in

evaluating whether to find a judicial estoppel, the

7 That is, if the Court were to hold that the second prong

were a necessary prerequisite for judicial estoppel, there would

be no judicial estoppel here because the district court has al-

ready held that factor is not met. Conversely, if the Court were

to hold that the second prong was only one consideration

among many (as the district court supposed), the district court

would make the same analysis as before, and the outcome

would be the same.

19

lower courts should, inter alia, “inquire whether the

party has succeeded in persuading a court to accept

that party’s earlier position, so that judicial accep-

tance of an inconsistent position in a later proceed-

ing would create ‘the perception that either the first

or the second court was misled.” 532 U.S. at 750.

That is exactly what the district court and the Ninth

Circuit did here. Applying those principles to the

facts of this case, they found that application of judi-

cial estoppel was unwarranted. They decided noth-

ing broader than that, nothing that put them in con-

flict with any other circuit, and certainly nothing

that would call for an exercise of this Court’s certio-

rari jurisdiction.

CONCLUSION

For the foregoing reasons, the Petition should be

denied.

Respectfully submitted,

JOHN F. DAUM DOUGLAS J. SERDAHELY

(Counsel of Record) PATTON BOGGS LLP

JORDAN RAPHAEL 601 West Fifth Avenue

O’MELVENY & MYERS LLP Suite 700

400 South Hope Street Anchorage, AK 99501

Los Angeles, CA 90071 (907) 263-6300

(213) 430-6000

Attorneys for Respondent Attorneys for Respondent

Exxon Mobil Corporation Exxon Shipping Company

Counsel for Respondents

August 21, 2009